A brief history of the NFT and the market prospects [vol. 2]
Hello, beloved community! Today, as we promised, we continue to tell you about the history of the NFT-market and the place of our project 1MillionNFTs in this growing structure.
March 2017 — Peperium
Ethereum began to grow in 2017, and that’s when memes began to sell there, too. As a result, the Peperium project was announced in March 2017. It was “a decentralized meme marketplace and trading card game (TCG) that allows anyone to create memes that last forever on IPFS and Ethereum.” Like Counterparty, which we mentioned in the previous article, Peperium also had an associated token with the ticker symbol RARE, which was used to create memes and pay for listings.
June 2017 — Cryptopunks
While trading rare pepe on Ethereum was rapidly growing, two “creative technologists” decided to create their own NFT project with a slightly different concept.
Their names were John Watkinson and Matt Hall, and the idea behind the project was for the platform to generate unique characters. Character creation was supposed to be done on the Ethereum blockchain.
In the end, the number of characters was strictly limited (there were 10,000 in total), and none were the same.
The creators named their project Cryptopunks, referring to Cypherpunks, who experimented with bitcoin precursors in the 1990s.
Watkinson and Hall decided to make access to cryptopunks completely free. That is, anyone with an Ethereum wallet could get a cryptopunk at no charge.
In the end, all 10,000 units were in demand, and they were quickly sold out. This started a secondary market where people bought and sold cryptopunks.
Curiously, they were not yet compliant with the ERC721 standard, as it simply didn’t exist at the time. They also didn’t fully comply with ERC20 standard because of its specifics.
That is, in fact, Cryptopunks is a hybrid of ERC721 and ERC20 standards. This, among other things, distinguishes this project from ours, every NFT of which is fully compliant with ERC721 standards.
What is the Ethereum Token Standard (ERC)
To ensure comfortable interaction, the Ethereum blockchain has different technical standards for the various types of tokens in its network.
What is ERC? It stands for Ethereum Request for Comment.
Right now, one of the most common standards is ERC20. This standard interaction structure is very useful for developers when they are creating tokens that need to work somehow with other tokens or applications on Ethereum. But! While ERC20 tokens work well for many features in Ethereum, they are not suitable for creating unique tokens. ERC721 was invented for exactly that purpose. That’s why the 1MillionNFTs team chose this particular standard. Thus, you can get a completely unique NFT and stack your place in the crypto history.
The two standards are similar in many ways, but ERC721 was developed specifically to become the technical standard for non-playable tokens.
If you highlight the main difference between the two is that ERC721 tracks the ownership and movement of individual tokens in a block, allowing the blockchain to recognize unplayable tokens.
The pioneer with the new NFT technical standard was the famous CryptoKitties.
October 2017 — CryptoKitties
With CryptoKitties NFTs hit the mainstream. CryptoKitties is a blockchain-based virtual game that allows players to adopt, raise, and trade virtual cats. Cats, on a blockchain!
This incredible project was seemingly on every news station, from CoinDesk to CNN. Perhaps it was because the game was clogging and slowing down the Ethereum blockchain or because people were making crazy profits trading them.
Some virtual cats were even selling for over $100,000.
CryptoKitties was launched in October 2017 in an ingenious manner by a Vancouver-based company called Axiom Zen. The team had been working on the project for a few months when they released the alpha version during the ETH Waterloo Hackathon, the world’s largest hackathon for the Ethereum ecosystem. With over 400 developers in attendance, it was the perfect place and time to introduce the game. The CryptoKitties team won first place in the hackathon and the game quickly went viral.
The rise of CryptoKitties coincided with the 2017 crypto bull market, which added more fuel to the fire. People were buying, breeding and trading virtual cats like crazy. This opened many people’s eyes to the potential of non-fungible tokens. Axiom Zen then spun out a company called Dapper Labs, which secured $15 million dollars in funding from top investors including a16z and Google Ventures. After witnessing the activity within the CryptoKitties community and seeing top investors pour money into Dapper Labs, people began to realize the true power of NFTs.
2018–2019 — NFT Cambrian Explosion
2018 and 2019 have seen massive growth within the NFT ecosystem. There are now 100+ projects within the space and more in the works. NFT marketplaces are thriving, led by OpenSea and SuperRare gaining ground. The trade volumes are small in comparison to other crypto markets, but they are growing at a brisk pace and have come a long way. On-boarding into the NFT ecosystem has become easier as Web3 wallets, like Metamask, continue to improve. Dapper Labs has also recently launched a Dapper wallet which requires no gas payments. Additionally, there are now websites such as nonfungible.com and nftcryptonews.com (shameless plug) which dive into NFT market metrics, gameplay guides and provide general information on the space. This graphic from The Block does a good job illustrating the current ecosystem.
CryptoKitties blazed the NFT trail but they could not have done it without the prior projects that laid the groundwork by building unique digital assets. This interesting graphic released by nonfungible.com shows just how important CryptoKitties is to the current NFT ecosystem.
This chart shows that people who own CryptoKitties tend to play other NFT games, while people who play other NFT games generally do not expand to play others. CryptoKitties acts as the perfect gateway into the world of NFTs.
CryptoKitties also may have experienced great growth due to the functionality of breeding different cats, which creates an entirely new cat or ERC721 token. There are now endless functionalities for NFTs, including character names (similar to domain names), plots of virtual land, virtual clothing, event entrance tickets, asteroid mining resources, and more. Perhaps the most exciting development within the space is the numerous NFT games and projects that are collaborating with each other to make items interoperable. For example, perhaps a player in one game has a sword that can be brought into another game to become a rare piece of clothing. With interoperability, the possibilities are truly endless.
2021 — …
In April 2021, we first announced the work of 1MilliionNFTs. This project combines creativity and commercial potential, and this differs from most players on the market. Every participant can stake his/her place in cryptohistory. Your space can look any way you want. And because the total number of NFTs is limited, the value of each section of the pixel grid will potentially grow.
Especially for you, we recently created a rich article about the prospects and opportunities of the 1MillionNFTs project. You can read it here.
And in this piece, we’ve shared the story of the project’s development, which will help you understand even better how the platform is structured.
So what happens next?
The history of non-fungibles is much longer than most people realize. The first attempts at NFTs were in the 2012–2013 Colored Coin era, but I believe now in 2019 we are still exceptionally early. Despite the massive growth we have experienced in the past two years, the space is still extremely young and growth will only continue. In fact, I believe the growth of the NFT ecosystem will accelerate as more people and companies realize the impact that NFTs can have and implement them more. Developers will continue to create innovative uses and interoperable items will be a complete game-changer. I suspect within five years the NFT space will look radically different than it is today, in which case I will have to write yet another update on the history of the ecosystem!
The countdown to release is on, we’re launching very soon.
Stay tuned!